Australia says Taiwan uranium sales okay by China - Yahoo! News

MELBOURNE (Reuters) - Two Australian mining companies recently entered contracts to sell uranium to Taiwan, it was revealed on Tuesday, a day after Australia signed a deal setting the stage for uranium exports to China.

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Energy Resources of Australia Ltd., and BHP Billiton Ltd./Plc. confirmed that they had contracts to sell uranium to Taiwan, and Australian Foreign Minister Alexander Downer said the deals were unlikely to cause problems for China, which regards Taiwan as a renegade province.

Australia -- which has a "one-China" policy -- negotiated arrangements with the United States in 2002 that made it possible to export Australian uranium to Taiwan via the United States, although contracts were only entered into during the past year.

"China always seemed comfortable with the idea (of Australia selling uranium to Taiwan)," Downer told Australian Broadcasting Corp. radio.

"I understand from my department in more recent times that they have said they're pleased that we have this arrangement in place because it means that it strengthens the overall security and safeguards of any civil nuclear industry in Taiwan."

A spokeswoman at the Chinese embassy in Australia could not be reached for comment.

Energy Resources and BHP both told Reuters that they had contracts to sell uranium to Taiwan.

"We are all sold out for 2006, so the earliest we would be looking at sending would be some time next year," said a spokeswoman for ERA, which is majority owned by Rio Tinto Ltd./Plc.

BHP Billiton also said it had entered into an agreement to supply uranium to state-run Taipower (Taiwan Power Co.) but said it did not give details on individual contracts with customers.

BHP is considering a major expansion of its Olympic Dam copper and uranium mine, which it acquired last year. Australia has about 40 percent of the world's known uranium reserves but it will only export to countries that have signed the UN Nuclear Non-Proliferation Treaty (NPT) and who also agree to a separate bilateral safeguards deal.

China and Australia signed a nuclear safeguards deal on Monday, although Canberra said the trade was unlikely to start for some years.

Downer said Taiwan had previously been a signatory to the NPT.

"Although it's no longer a state ... nevertheless it continues to fulfill all of its obligations under the NPT," he said.

The Taipei Economic & Cultural Office in Australia was not immediately available for comment.

India also wants to buy uranium from Australia but has not signed the NPT.

($1=A$1.40)

(Additional reporting by Michelle Nichols in Canberra)